In a meeting chaired by Prime Minister Shehbaz Sharif on 28 July 2026, the Cabinet Committee on Energy (CCoE) approved amendments to the Pakistan Oil Refining Policy 2023 for Up-gradation of Existing (Brownfield) Refineries. The decision addresses implementation hurdles to help mobilize an estimated $5 billion to $6 billion in modernization investments across the nation's refining sector.
Tax Exemptions and Production Goals
A central feature of the revised policy is resolving sales tax complications resulting from the Finance Act 2024. Under the new provisions, domestic refineries will receive General Sales Tax (GST) exemptions on imported plant, machinery, and equipment needed for upgrade projects. The policy modernization seeks to shift refining operations toward producing Euro-V compliant petrol and high-speed diesel (HSD) while significantly lowering furnace oil output.
Compliance Framework and Timeline
To access policy incentives and begin upgrade initiatives, domestic refineries: including Attock Refinery Limited (ARL), National Refinery Limited (NRL), Pakistan Refinery Limited (PRL), Pak-Arab Refinery Limited (PARCO), and Cnergyico PK: must execute formal Upgrade Agreements with the Oil and Gas Regulatory Authority (OGRA) within 90 days. Following the signing of these agreements, refiners will have a seven-year implementation period to complete their facility upgrades.
Foreign Investment Focus and Regulatory Status
To attract required capital into the refining industry, Prime Minister Shehbaz Sharif directed authorities to organize investment roadshows in Qatar, Saudi Arabia, and other Gulf states. Full implementation remains subject to final administrative steps, as the official gazette notification and detailed OGRA regulations regarding escrow and deemed duty mechanisms are pending final publication.